Capitol Comments by Senator Kent Sorenson District 37 Representing Madison, Warren and Southern Dallas County
"Peanuts, popcorn, candy apples!!"
For the last two weeks we’ve been looking at and voting on legislation that is, for the most part, noncontroversial in nature. Bill after bill we’ve been voting on has been passing with bi-partisan support and I’m fine with that because some of this stuff needs correcting.
For example, HF 290 (formerly SF 78) allows a motorcycle with added stabilizing wheels in the back to remain classified as a motorcycle instead of being reclassified as an automobile. This lets motorcycle owners avoid the added fees that such modifications create. It passed with ease and was sent on to the Governor’s desk because it’s just plain ole’ common sense.
Senate File 471, known as the Red Tape Commission bill, requires each state agency to review all of its administrative rules on a five-year cycle, with the goal being the removal of outdated and unnecessary rules. It too passed out of the Senate and went on to the House because it’s downright unfashionable in our current economic climate to be touting more rules and restriction that are disconnected from reality.
And one other bill that just made sense to everybody was the Stolen Valor Act that made it illegal for a person to impersonate a decorated military veteran with the intent to deceive another person for the purpose of monetary gain. It passed 48-0, with two senators excused for health reasons.
You seeing what I’m seeing? One would think so. For brief moments it seems like common sense became contagious.
But then we get another healthy slap in the face in the form of the Small Business Health Care Tax Credit bill.
This bill provides an Iowa refundable tax credit against income tax liability equal to 25 percent of the new federal Small Business Health Care Tax Credit for Iowa domicile employers with ten or fewer full time employees. The Iowa credit is refundable, and the federal tax credit gives a tax credit to certain small employers that provide health care coverage to their employees.
Sounds good, and it passed with a vote of 48-0, but the untold story is what goes unnoticed!
You see, an amendment to the bill that would allow the Iowa credit (for businesses that employ up to ten full time employees) to apply to any small businesses that qualifies for the federal credit (which allows for businesses that employ up to 25 full time employees) was voted down along party lines!
So if I get this right, the federal government thinks we should give this tax credit to businesses that employ up to 25 full time employees, but the big spending, big taxing majority party in the Senate believes the state of Iowa should restrict that credit to only those who employ up to ten people?
Don’t get me wrong here, small businesses who employ up to ten people deserve every single tax break they can get!
But if I were a small business that employed ten people and was thinking about expanding my production abilities and hiring more employees, where is my incentive now? The moment I’d go from ten employees to 11, I’d lose those tax credits!
And the flip side is also true. Because who knows, if someone has 11 employees and only has to fire one to qualify for those tax credits, that just might be enough to let an employee go.
So while this indeed does give a tax break to some small businesses, it seems to be a dis-incentive to others (a net-neutralizing effect), and I know of several small businesses right now that could certainly use that tax break that the federal government already agrees upon.
So the dog and pony show (read: CIRCUS) rolls on.
But don’t be fooled, because it’s not entertaining. This stuff affects people’s lives. It affects their paychecks, and it affects their standard of living.
What the big-tax-and-spenders in control of the Senate are really doing is continuing the debacle of the last several years in the hopes that they can use votes like the small business health care tax vote to make themselves look small business friendly while at the same time try to blame conservatives like me for not doing anything to ease the strain on the economy they created.
It isn’t true, and we won’t forget.
Feel free to give me your input by writing to [email protected], and I appreciate hearing from you.
Kent Sorenson Serving Warren, Madison and SE Dallas Counties